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credit needs, the farmers themselves
began to organize their own credit co-
operatives to provide short-term loans.
Beginning in 1923, production credit
for farmers became available in some
localities through agricultural credit
corporations and livestock loan com-
panies, some of which were formed by
groups of farmers. The organization
of these enterprises, however, was de-
pendent upon local initiative, and
many thousands of farmers were lo-
cated in areas where none was formed
because capital funds were lacking.
In order to meet the need of farmers
requiring short-term credit, Congress
provided in the Farm Credit Act of
1933 for a Nation-wide system of
production credit associations.
Production Loans Finance
Wide Variety oF Farm Needs
Each year now thousands of Wiscon-
da farmers borrow from their produc-
fon credit associations for many pur-
poses. Dairymen borrow to purchase
dairy cows, equipment, and feed, and
to finance improvements to barns.
Because of the year-around nature of
the dairy business, repayments are usu-
,llY made in regular installments from
the milk or cream checks. Although
nost dairy loans are made for 1 year,
bhe unpaid balance, representing funds
idvanced for purposes other than an-
mal recurring costs, may be renewed
at the end of that time provided the
anuity and the borrower's repayment
seord are satisfactory.
Loans to produce fruit and vege-
Ables, grain, tobacco, and other crops
re made on a seasonal basis, the loans
ebing repaid when the crops are har.
rested and sold. The farmers who
red cattle, hogs, and sheep pay their
loans when they receive payment from
the sale of the livestock financed.
  Wisconsin farmers are served by 21
production credit associations-at An-
tigo, Baraboo, Barron, Chippewa Falls,
Dodgeville, Elkhorn, Fond du Lac,
Green Bay, Janesville, Juneau, Lan.
caster, Luck, Madison, Mondovi, Neills-
ville, River Falls, Sparta, Waukesha,
Waupaca, Wausau, and Wisconsin
Rapids. At the end of December 1940,
the associations had over 10,500 loans
outstanding for more than $5,800,000.
Between organization and this date,
they had made over 72,000 loans
amounting to approximately $47,-
000,000.
  The Wisconsin production credit
associations offer farmers' notes for re-
discount to the Federal Intermediate
Credit Bank of St. Paul, which, in
turn, obtains funds through the sale to
the investing public of its debentures,
which are backed largely by the secur-
ity of the farmers' discounted notes.
By this plan the large money markets
are made available to farmers at an
interest rate comparable to rates paid
by other industries. Thus, Wiscon-
sin farmers have been able to obtain
short-term credit at low rates. In
March 1941, funds are being loaned
at 4% percent per annum. Not only
association members have benefited
from this low interest rate, but also all
those other farmers who have obtained
short-term loans from other credit
sources, which have reduced their rates
to levels comparable to that of the
production credit associations.
  The associations are chartered by
the Governor of the Farm Credit Ad-
ministration. Directors of the asso-
ciations are elected from among local
farmer-members according to the co-
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